Waddell (1978)

Notes on the text

Part I

Preliminary pages Contents, Membership
Chapter 1 Introduction
Chapter 2 Educational matters
Chapter 3 Structure of the examining system
Chapter 4 Cost
Chapter 5 Conclusions
Appendices

Part II

Preliminary pages Contents, Membership

Report of the Education Study Group (ESG)

Glossary, Introduction
Chapter 1 Feasibility of common exam system
Chapter 2 English
Chapter 3 Mathematics
Chapter 4 Science
Chapter 5 History
Chapter 6 Geography
Chapter 7 Modern languages
Chapter 8 Classics
Chapter 9 Commerce
Chapter 10 Social science
Chapter 11 Religious studies
Chapter 12 Craft design and technology
Chapter 13 Technical drawing
Chapter 14 Home economics
Chapter 15 Needlecraft and dress
Chapter 16 Art
Chapter 17 Music
Chapter 18 Further work
Appendix A List of witnesses
Appendix B Questions
Appendix C Statistics
Appendix D Joint examinations

Report of the Cost Study Group (CSG)

Chapter 1 Introduction
Chapter 2 Costs in 1976
Chapter 3 Costing a common system
Chapter 4 Changeover costs
Annexes

Report of the Steering Committee established to consider proposals for replacing the General Certificate of Education Ordinary Level and Certificate of Secondary Education examinations by a common system of examining

Chairman: Sir James Waddell CB

Presented to Parliament by the Secretary of State for Education and Science and the Secretary of State for Wales by Command of Her Majesty July 1978

London: Her Majesty's Stationery Office 1978
© Crown copyright material is reproduced with the permission of the Controller of HMSO and the Queen's Printer for Scotland.

Part I: Cmnd 7281-I
Part II: Cmnd 7281-II

Part II - CSG Report

Chapter 3 Costing a common system
[pages 150 - 161]

EXAMINATION BOARD COSTS

51. The previous chapter related to the first part of our remit, 'to consider costs of examining under the present dual system (CSE and GCE O Level)'. In this chapter we take the second part, which is to make recommendations as to how our findings 'might assist in costing possible models for a future common system of examining at 16+'. We have approached this task in the knowledge that only very generalised models can be constructed at present, and that the assumptions we make in costing them will be open to question. But as stated in Chapter 1, our aim is not to provide a definitive costing; it is to explore the range of possible costs that might be involved in operating a common system, and to provide a basis for reference and use in developing such a system. Our costings are illustrative, in that they illustrate methods of calculating possible costs rather than any precise pattern of assumed expenditure.

52. Our method in this chapter is therefore to take what seem to us the main considerations that would produce changes in expenditure under a common system, and to cost these at the highest and lowest levels of feasibility. Many of our figures are speculative, and it is not in our minds that they reflect what is likely to happen. They are intended as indicators of the cost implications of certain developments which are theoretically possible, even if often improbable in practical terms. Thus we conclude this chapter with a summary of costs which adds together all the highest figures postulated and the lowest, because without such a summary the figures may be calculated by others and quoted as if they had a reality which we do not believe they possess. Not only do most of the contributory figures contain assumptions which are themselves open to debate, but it is hardly conceivable that, even if the assumptions proved correct, all the most extreme circumstances would combine to produce a result at one end of the range, or at the other.

53. The costings in this chapter are based on the supposition that a common system of examining was in operation in 1976. The pattern of boards' expenditure on 16+ examinations in England and Wales and the levels of subject entries were as follows:

Table 5

For the purposes of this section, the administrative, salaries and premises costs of the GCE boards which cannot be directly attributed to 16+ work have been apportioned in the ratio that the boards' 16+ direct costs bear to their non-16+ direct costs. The apportionment is thus notional; it expresses the cost of 16+ examinations as a share of the boards' total costs. It does not imply that these would have been the real costs of setting up the 16+ examinations on their own.

Changes likely irrespective of administrative organisation

54. The introduction of a common system would probably influence the number of subject entries in two ways. Firstly, the elimination of double entries would reduce the total; secondly, winter entries would be likely to increase. Taking these two points in turn:

Double entries

The extent of double-entering pupils is not known but the evidence available is that it lies somewhere between a minimum of 1 per cent of total entries and a maximum of 5 per cent. These estimates imply a potential reduction in the number of subject entries of between 56,000 and 280,000.

Winter entries

These for GCE boards were just under 5 per cent of all entries (ie GCE and CSE combined) in 1976. It is not known what proportion of such entries were resits, or what effect (if any) a decision to limit winter examinations under a common system to resits in major subjects would have. It might cause a small reduction in the total; but against this must be assumed the tendency for the number to increase, as resit examinations became available to CSE (as well as GCE) candidates. A reasonable range of assumptions therefore seems to be from no increase in numbers to an increase from 5 per cent to 7.5 per cent of all entries. This would add from nil up to 140,000 subject entries.

55. The above assumptions combine to give revised subject entries of:

It is estimated that these volume changes would affect the expenditure of the examining boards to the following extent:

Table 6

Changes likely as a result of changes in administrative and educational arrangements

56. The guidance we have received is that examining boards are likely to come together in groups for the purpose of offering common 16+ examinations. There are certain general cost implications of board grouping which need to be considered before we explore the effects of specific administrative structures.

57. Throughout the rest of this chapter, our costings of both general and specific factors are often expressed as ranges of cost per subject entry. It is important to recognise that a seemingly small change in cost per subject entry has considerable cost implications. Thus an increase in the average cost per subject entry of 10p for an item throughout the system would add just over £0.5m to the total expenditure of boards.

General

58. Any grouping which brings different boards to work together is likely to result in both examiners and teachers within the group, and the staffs of the constituent boards, comparing the levels of payments they receive for what they regard as broadly similar work. It is of course impossible to say what the outcome would be. Payments to examiners and teachers vary between 76p and £1.34 per subject entry (average figure 96p) for CSE boards; and between 84p and £1.24 (average £1.00) for GCE boards. There would be a certain pressure to standardise payments and to do so at the highest rates paid by the boards within the group; certainly, boards paying markedly low rates would come under pressure to raise them. On the other hand, it may be that tasks which seem similar, and therefore deserving equal remuneration, in fact differ in important respects - for example in complexity, with implications for the time required for the task.

59. Although we assume no increase in these payments as one theoretical extreme, experience suggests that there would in fact be pressure for them to rise. If they settled around the average the increase would be about 2p; if they rose to the highest level at present paid, £1.34, the increase would be 36p. The additional cost of the first assumption would be £112,000 and of the second £2,021,000. In view of the width of this range, and the very substantial impact on costs that the higher figure represents (it is more than half the total maximum cost for any of the three models costed below - see para. 74) we considered the reality of these figures a little more closely. The figure of £112,000 seemed unduly modest, and we felt that the tendency would be for payments to examiners and teachers to rise well above this, probably to above rather than below the midpoint between the two theoretical extremes (ie £nil and £2,021,000). But the higher extreme figure seemed equally unlikely. We noted that the two most expensive boards in terms of these payments - the SREB and SWEB CSE boards - were far from typical in their styles of examining. For example, the schools in the SREB region are formed into consortia. Scripts for all modes are marked by the teachers in each school; they are then checked by teachers from another school, and a sample is checked further by the board. A per capita fee is paid for marking and moderating, and much travelling is involved. Thus the travelling costs are abnormally high. To assume that the costs of all boards would rise to the level of those for this board requires the parallel assumption that all boards would adopt a similar approach to assessment. Such an assumption can be discounted for practical purposes and the figure of £2,021,000 viewed accordingly.

60. A similar effect of any form of grouping would be the comparisons made between the salaries paid to board staffs, and it might again be argued that there would be a tendency for these to rise in certain cases. The argument is less clear here, since the salary costs per subject entry are obviously affected by the size of the board. It is therefore difficult to separate price and volume factors. If, however, it is assumed that there would be some levelling up, and if our calculations are based on present standards with no regard for changes in management, it might be reasonable to allow for a minimum of about 5 per cent and a maximum of 20 per cent. In terms of the cost per subject entry stated in the right-hand columns of the table in paragraph 53, such increases would vary between 3p and 13p, and produce an additional cost for boards between £169,000 and £730,000.

61. To be balanced against a possible increase in payment to examiners, etc, are the undoubted - although unquantifiable - savings that ought to accrue from the dialogues between constituent boards under any form of grouping, however loose. It would be strange if the dialogues did not result in boards finding that others used procedures which were less costly and/or more efficient in certain respects, and in boards using each other's resources or coming together to make more economic use of outside resources. Against this, however, would be a tendency in the opposite direction, for boards to want the superior facilities others already possessed.

62. The impact of a common system on the balance of board-based and school-based assessment is another factor which cannot readily be costed. The report of the Educational Study Group suggests that a wider range of assessment techniques may be necessary if a common system is to provide adequately for the range of ability now covered by O Level and CSE examinations. At present approximately 12 per cent of all 16+ subject entries are classified as Mode III. A common system might well see an increase in the already developing tendency towards a more mixed-mode approach, with many examinations containing both board-based and school-based elements; at the same time the number of pure Mode III schemes might decline. Overall, some increase in school-based assessment seems likely, and it is arguable that if this were to become a regular feature of considerably more examinations a pressure would develop for teachers to be paid for any substantial work involved, especially if participation in school-based assessment ceased to be at their individual discretion, as it is at present. The effect would be to reduce the incidence of 'hidden' costs and to increase examining board direct costs, with a consequent implication for the level of fees charged and the expenditure of the local authorities which pay them.

63. Assuming that either 15 per cent or 30 per cent more subject entries under a common system had a sufficient element of school-based assessment to justify payment; and assuming that such payments by boards to teachers ranged from 5p to 50p (the maximum payment per subject entry at present) the additional direct cost to the system would be as follows:

64. We consider it reasonable to assume that under any system of board grouping some coordination of syllabus provision would be likely; that is to say, not all boards within a group would continue to offer syllabuses in all subjects. Even in major subjects some reduction may be possible; in minority subjects one would expect a greater degree of rationalisation, with a substantial reduction in the number of syllabuses on offer in the least popular subjects. A reduction in the number of syllabuses would of course have a substantial effect on costs. Firstly, the expenditure necessary to develop the range of new syllabuses would be affected - we cover this aspect in Chapter 4. Secondly, the annual running costs of examining would be reduced. The payments to examiners and teachers for setting papers would be lower, the printing costs would be reduced in terms of the 'setting-up' costs for papers, and boards' salary costs might be affected. We estimated that there would be a saving of £900 in annual running costs for each syllabus which ceased to be available. This amount is based on the following calculation:

Estimated number of subject entries for each Mode I syllabus: 4700

Savings for each subject entry assumed to be:

65. The extent of any syllabus rationalisation, however, would be likely to depend upon the administrative structure of the new system. We consider below the three possible administrative structures which you asked us to cost. For model (i) we assume that the extent of syllabus rationalisation would be so modest as not to merit costing; for model (ii) we assume a reduction of up to half in the total number of syllabuses; and for model (iii) a reduction of up to a third.

Examples of possible administrative structures

(i) A structure involving a grouping of boards with some central coordinating machinery

66. As each board would continue to offer its examinations in the main subjects at least, it would retain all its professional and administrative staff. Provision of any central coordinating machinery would be likely to impose an extra cost. Liaison between boards would be considerable, and some form of liaison committee would be required which would need servicing, at an assumed annual cost (including on-costs) of £12,000 per group. The need for liaison would imply a substantial additional cost for travelling and subsistence expenses, for which we allow £10,000 per group.

67. Assuming five groups altogether, the one for Wales would require no additional expenditure as it is already federated. On the basis of four groups for England, the maximum annual extra cost for this model would thus be £48,000 for liaison plus £40,000 for expenses, giving a total of £88,000.

(ii) An integrated grouping of boards

68. This model has similarities with that at (i) above but it is assumed that central coordination would be stronger, and would include the processing of candidate entries. A joint academic board and a measure of centralised financing also seem likely under such a model. These would require administrative and secretarial servicing. Whilst much of the staffing requirement might be expected to come from existing resources, we assume that three administrative staff, with clerical and secretarial assistance, would be needed for each group, and cost these (on the basis of existing salaries paid by boards) at £48,000 per group. And again we assume an additional burden on travelling and subsistence expenses, costing £10,000 per group. (For this model Wales is included, but without any extra travelling and subsistence expenses assumed).

69. For this model we assume that the number of syllabuses required overall is likely to be reduced by up to half, and in the next chapter we calculate that on the basis of present figures the maximum number of new syllabuses required (ie assuming no reduction) would be in the region of 1,200. Thus we are postulating that there might be a saving of up to 600 syllabuses at a marginal cost of £900 each. Assuming, to provide a range, a minimum reduction of 400 syllabuses as well as the maximum of 600, the total saving would be between £360,000 and £540,000.

The net effect would therefore be as follows:

Thus the reduction in expenditure is dependent on the assumed reduction in the number of syllabuses. For example, if only 310 syllabuses were saved, the net effect would be no change in expenditure under this model.

70. A further saving should be assumed for the likely effect on most of the constituent boards under this model of a more centralised administration. Savings might well accrue, for example, from a reduced requirement for the separate administration of minority subjects and processing subject entries. The extent of such changes is speculative, and much would depend on the administrative style adopted by each group, but if it were assumed that each reduced its staff complement by one subject secretary and one administrative assistant, a reasonable saving might be in the region of £12,000 per board, or £264,000 altogether (ie £12,000 x 22 boards).

(iii) A system involving fewer boards than at present

71. In this model the number of boards would be reduced to 15, of which one would cover Wales. For the purpose of illustration we assume that the 14 largest English boards would remain in existence. No regard has been paid to the geographical implications of this nor to the availability of staff or adequacy of premises; it is simply a convenient basis on which to cost.

72. In 1976 the 15 boards provided for 4,994,000 subject entries, ie 89 per cent of the total for England and Wales. The actual numbers were:

The subject entries for the remaining six boards totalled 621,110. The following table divides 1976 expenditure into two categories:

Table 7

73. If the 15 boards could provide for the extra 621,000 subject entries (ie an extra 12 per cent on their present load) without increasing expenditure, the total saving would be in the region of £1.5m (£1,569,000). However, certain items of expenditure, eg payments to examiners, vary more or less in proportion to the size of the subject entry, so some additional expenditure would be incurred by the 15 boards. We suggest the following revised pattern of expenditure:

Table 8

On these assumptions the reduction in expenditure from reducing the number of boards to 15 would be in the order of £688,000.

Summary of cost changes

74. As promised in paragraph 52 above, and with the reservations there stated, we now summarise the theoretically possible range of costs of running a common system arising from the assumptions made in this chapter.

Table 9

Table 10

PREMISES COSTS

75. We were also asked to consider what the effect would be on costs if the university premises of GCE boards were not to be available for use under a common system. This section of the chapter applies only to England. With the exception of the AEB the six English GCE boards have close university links that influence their accommodation costs. With one exception their accounts do not include a charge for the amortisation of their buildings.

76. In order to estimate this effect we have had to make assumptions about:

(i) the area used for 16+ examinations work;
(ii) the cost(s) per square foot/square metre;
(iii) any amounts already included in 16+ examination costs.

77. The premises of GCE boards accommodate O Levels, A Levels, overseas examinations and private candidates. The actual space used for 16+ work is therefore not available. Four methods of estimating the likely space have been tried and are set out below. The results give a range for all the boards from 131,000 sq. ft/12,170 sq. m up to 171,000 sq. ft/15,886 sq. m.

a. Assume that each GCE subject entry requires the same area as the average CSE entry - total 131,000 sq. ft/12,170 sq. m.

b. Assume that the actual area of the six boards is split between 16+ and other examination work in the ratio of their direct expenditure - total 143,000 sq. ft/13,285 sq. m.

c. Assume that the actual area of the six boards is split between 16+ and other examination work in the ratio of their subject entries - total 158,000 sq. ft/14,678 sq. m.

d. Assume that the area derived from a. above be increased in the ratio that the average area per GCE board employee bears to the average area per CSE board employee - total 171,000 sq. ft/15,886 sq. m.

78. The terms of leasing suitable office, sorting and storage accommodation vary greatly from one place to another and from one time to another. For example, the lowest 1976 leasing rate for CSE boards was 65p per square foot, for the SWEB, and the highest £5.14 per square foot, for the Middlesex Board (£7 and £55.43 per square metre respectively). But these were historic costs and cannot be taken as representing what the cost would have been of leasing accommodation for the first time in 1976. We therefore had inquiries made of the Chief Valuer's Office, which suggested that the range of such costs in urban areas around the country (excluding the more expensive areas of inner London) would have been from £1.95 to £6.04 per square foot (£21 and £65 per square metre) in Manchester and Croydon respectively; an intermediate cost, for both Oxford and Cambridge, would be £4.18 per sq. foot (£45 per sq. metre).

79. On this basis the annual cost at current prices of replacing university premises used for 16+ examining work would range from:

These figures represent 5p, 18p, and 13p per subject entry respectively.

Existing charge

80. The London GCE board included in its 1976 accounts the rental charges for the premises they occupy. Thus the effect on 16+ examination costs of the withdrawal of university premises would not be the full amount as shown in the foregoing sub-section. It would need to be reduced by about £100,000 - an estimate based on the proportion of the London total premises costs of £343,600 that may be said to represent the rental element for 16+ examinations.

Equipment costs

81. Closely linked to the availability of university premises is the use of the university equipment within them - computers, accounting machines, printing equipment, etc. Although these would presumably also cease to be available it would not be sensible to assume that they would all need to be provided new elsewhere. Nevertheless, some additional expenditure would be involved. Precise figures for the value of existing equipment are not available, but a total replacement cost of £4m has been suggested. Assuming that between 25 per cent and 50 per cent of this amount might be needed, and assuming also the average life of such equipment to be 10 years, the annual cost involved would be between £100,000 and £200,000, representing a range from 2p to 4p per subject entry.

External considerations

82. All the assumptions made in this chapter have been related directly to the examinations system as it operated in 1976. Obviously by the mid 1980s, when a common system might be implemented, the situation will have changed and a number of different factors will bear on whatever examining system then exists. The broad changes we envisage are declining school rolls, changes in the take-up rate of examinations, variations in subject popularity, and general economic pressures. These are not all of a kind. The first has the most obvious bearing on costs, but whilst the decline in school population itself can be forecast with reasonable accuracy, its effect on examining costs cannot. The other factors seem entirely unpredictable and we have felt unable to attempt any quantification of their effect. Nor have we seen it as being within our remit to do so, since we are concerned with how the introduction of a common system will affect costs, not with what factors will affect them irrespective of changes in examinations.

83. The decline in school rolls will of course significantly affect the number of candidates entering for 16+ examinations in the 1980s. The current estimates are that candidate numbers in summer examinations will rise from the 1976 level of 1,227,000 to 1,420,000 in 1982, but will drop thereafter each year to about 1,180,000 - and still be dropping - in 1990. But under any examining system payments to examiners for marking scripts will reduce in line with the decrease in candidate numbers; other payments, such as the cost of setting examination papers will probably not reduce at all; and other costs, such as boards' staff salaries, printing and stationery, will decrease but not in proportion to the reduction in numbers. The impact is therefore to reduce total costs while the average cost per subject entry (and hence fees) will tend to rise.

84. The decline in school rolls may have differing implications for the three illustrative administrative models above, and our costings of these should be considered in the light of this factor. But some savings could be envisaged whatever administrative solution was adopted.